Historically, business-to-business payments (“B2B payments”) have been executed by printing and mailing checks or by processing payments over the ACH or Wire settlement networks. Increasingly, however, B2B payments are made by virtual credit card-based solutions, in part due to rebates offered by credit card issuers. Suppliers who receive a virtual card number for invoice payment process them just as they would process any other card-not-present transaction (e.g., a credit card number received via phone call or via an e-commerce web site). Suppliers enter the card number, expiration date, security code and amount on their merchant terminal or point-of-sale (POS) terminal, and the card payment is authorized and settled just like any other credit card.
While virtual credit card-based B2B payments offer benefits to payers, distribution of virtual credit card numbers creates certain security risks if such numbers are distributed to unauthorized users. Specifically, using virtual credit card-based B2B payments presents a challenge in terms of authenticating the recipient of the card. To address this security risk, current credit card-based B2B payment systems require suppliers to authenticate themselves by pre-registering with a third-party payment processor. This pre-registration process is directed to authorizing the supplier to receive credit card-based payments for all purchases, rather than authorizing only a specific purchase. For this reason, the pre-registration process does not take into account details associated with specific purchases. Instead, the pre-registration process identifies contact information, user preferences, and/or other details generally applicable to the suppliers.
Separate pre-registration and payment processes provides for authenticating the recipient of a virtual credit card and minimizes security risks associated with delivering credit card information to the supplier. For suppliers that frequently receive payments, such pre-registration processes efficiently manage security risks.